Outgoing Boeing boss to receive more than $60m
David Calhoun, Boeing's new president and chief executive, assumed control of the troubled US aerospace manufacturer on Monday, as it emerged that his predecessor had left with more than $60m in compensation and pension benefits.
Dennis Muilenburg, 55, was sacked as chief executive in December after a torrid period for the aerospace giant. The entire 737 Max aircraft fleet had been grounded since March 2019 in the wake of two fatal crashes in Indonesia and Ethiopia that killed 346 people, with the company facing multiple investigations as a result.
The grounding had cost Boeing an estimated $9.0bn to date, with more costs likely to be disclosed in its fourth-quarter earnings update at the end of January.
Its reputation suffered another big blow during just the previous week when a cache of emails was released that revealed internal efforts had been made to avoid regulators imposing costly extra training requirements for 737 Max pilots.
Hence the board's recent change of tack and recommendation to regulators that stimulator training for pilots be made mandatory.
In December, Boeing said a change in leadership was necessary “to restore confidence in the company [...] as it works to repair relationships with regulators, customers and all other stakeholders.”
Calhoun, 62, a long-time director of Boeing, had a “proven track record” and recognised “the challenges we must confront”, the company added.
But since then, Boeing has confirmed in regulatory filings that despite Muilenburg being sacked, and receiving no severance pay, he will still leave with $62.0m in compensation and pension benefits. Boeing said he was “entitled to contractual, pre-existing retirement benefits”. Mr Muilenburg, who had worked at Boeing throughout his entire career, also held stock options that were currently worth around $18.5m.
Calhoun would be paid an annual salary of $1.4m and be eligible for a long-term compensation scheme worth $26.5m if various goals were met, including the return to service of the 737 MAX.
Shares in Boeing were largely flat at $330.52 as at 1430 GMT.